Cambridge-based Cycle Pharma has launched a $466m (£364m) hostile bid for its New York-listed competitor, Vanda Pharmaceuticals, in an unusual takeover attempt.
The privately-owned rare diseases drug company has directly approached Vanda’s shareholders with an $8 per share cash offer. Vanda shares closed up over 24 per cent on Thursday following the news.
The takeover bid was formally made to Vanda’s board on 24 May, the same day Vanda rejected a separate $7.75 per share unsolicited offer from Future Pak, which initially tabled a $4.05 per share bid on 17 April.
Cycle’s proposal represents a 98 per cent premium to Vanda’s closing share price on 16 April, the day before Future Pak’s first offer.
Cycle Pharma said its proposal “represents a better outcome for shareholders, who would receive all-cash upfront value exceeding that of Future Pak’s cash portion of its latest offer announced May 7, 2024.
“It would also benefit patients, as Cycle has a proven commercial strategy in the US, a strong distribution footprint and an established track record of delivering medicines and individualised support to patients suffering from conditions with high unmet medical need.”
The company also said it would have preferred to reach an agreement through private negotiations but has taken it public to encourage shareholders “to express their views on this proposal to the independent directors of Vanda”.
Vanda Pharmaceuticals, based in Washington DC, confirmed the receipt of Cycle’s “unsolicited, non-binding indication of interest” and stated it would carefully review and evaluate the proposal.
Cycle Pharma, which operates from the prominent life sciences hubs of Cambridge in the UK and Boston in the US, employs 120 people, nearly half of whom are based in the UK.
The company focuses on treatments for neurological, rare metabolic, and rare immunological conditions, many of which are genetic.